Red-hot solar market powers Duke City firm into expansion

Privately held UniRac Inc. has signed a lease to move into about 60,000 square feet of manufacturing space just north of Downtown.

The move more than doubles the Duke City-based company's floor space and will necessitate a ramp-up in employment at the company, which is one of the nation's leading manufacturers of mounting systems for solar panels. The firm currently employs about 40 people, says company Vice President Hal Newman.

"We'll clearly be adding new people when we move into the new facility," Newman says.

The new UniRac facility could employ 80 people in the next three years, at which point Newman says his company might need to expand again if the world market for photovoltaic systems continues to grow at a steady clip.

"Business is going great and we've been growing right alongside the demand for PV," says Newman.

So far, solar is red hot.

Solar energy research and consulting company Solarbuzz Inc. says the world saw 927 megawatts worth of new photovoltaic systems installed in 2004. That level marks a 62 percent increase over what came on line in 2003. The world's leaders in new system installations are Germany and Japan. But in 2004, the number of new photovoltaic system installations in the U.S. grew by 27 percent, compared to a 17 percent growth rate in 2003.

Photovoltaic systems are the most common way of harnessing solar power. They convert sunshine directly into electricity. PV panels can produce power for off-grid systems such as road signs or remote residential locations, or in large-scale, "grid-tied" units that are connected to utility grids. Grid-tied applications often can be found on residential homes or on commercial buildings.

UniRac's new lease at 1411 Broadway Blvd. NE will start on Dec. 1, Newman says. The company currently occupies about 25,000 square feet south of the Albuquerque International Sunport at 3201 University SE.

Newman says capital for the expansion is coming from the company's revenues and that business is on pace to grow by 50 percent this year, although he says growth probably will ultimately end up between 35 and 40 percent above 2004's pace.

The industrial building complex where UniRac will lease its new space is owned by Roger Cox & Associates Inc. UniRac was represented in its lease negotiations by brokers Kevin Bobb and Anne Apicella of Grubb & Ellis New Mexico.

Bobb says many brokers at Grubb & Ellis are seeing small technology companies move their manufacturing operations out of town, but UniRac is different.

"It's refreshing to see a company started and run by some local ideas," Bobb says.

UniRac, founded in 1997 by Newman's partner John Liebendorfer, manufactures and designs its own photovoltaic mounting systems. The company was incorporated in 1998.

Two of UniRac's largest customers are the Australian government and the state of California, which is "far and away" UniRac's largest market, Newman says. Last year, about 40 percent of UniRac's business came from state entities in California.

The new manufacturing space primarily will increase capacity. At the new site, Newman says his company will make its already designed mounting structures as well as new products it will develop. UniRac's new facility is adjacent to more square footage that Newman says his company could move into when it looks at expanding again in a few years. Meanwhile, it is producing a variety of products.

"We, this year, expect to do in excess of 30 megawatts worth of systems," Newman says.

For solar, 30 megawatts worth of photovoltaic systems is huge.

In comparison, the state's largest utility provider, Public Service Co. of New Mexico (PNM) unveiled plans to encourage its customers to install photovoltaic systems by offering a rebate program for grid-tied systems. That plan, which requires state regulatory approval to launch, aims to promote the creation of 1.2 megawatts of solar power from PV systems on homes and businesses over the next eight years. PNM says the power from 1.2 megawatts would be enough to provide electricity to about 600 homes.

UniRac says solar power, already growing in popularity, is getting a boost from rising costs for energy produced from electricity and natural gas.

"As energy prices continue to go up, the attractiveness of photovoltaics as a technology gets better and better," says Newman.